Mature Analytics Improve Profit Margins

By
Nancy Fass

October 1, 2019

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Melbourne Business School and global management consulting firm A.T. Kearney released The Value of Analytics in 2019, which reveals that analytics maturity correlates directly with greater profit. It suggests that those companies that don’t extract the full potential of analytics would be able to generate up to 83% more profit if they were to adopt these processes and behaviors.

The report is based on the Analytics Impact Index, which measures how organizations use data analytics, the impact of analytics on profit, and ways to extract the most value from analytics. It features the results of surveys of more than 350 companies with a median revenue of $745 million and representing 27 industries from across 46 countries.

The research states that U.S. companies lead their global peers in maturity and impact from their analytics functions—how developed their analytics capabilities are and how much value their analytics operations add to the bottom line. U.S. companies score 5% to 10% higher in analytics practices and processes than the rest of the world and extract greater returns from analytics.

In addition, the report says analytics teams led by C-suite executives generate more than twice as much profit as those led by managers. For more information and to download the full report, visit bit.ly/2kjlHiG.

Nancy Fass is a senior editor for IMA® (Institute of Management Accountants). She can be reached at nfass@imanet.org.